Two seemingly opposite Central Florida residential developments — The Villages and Lake Nona — both dominated sales last year not just in the region but also nationally.
Northwest of Orlando, The Villages active adult development last week held onto its perennial spot as the nation’s best-selling master-planned community. Yet its sales have declined for years, according to a new report by Real Estate Advisors.
“The reason that sales have gone down is that it’s at the peak of its life cycle,” said Gregg Logan, managing director of RCLCO, which tracks sales of 300 master-planned communities nationally. “If you look at any large master-planned community, they go through cycles. The Villages is at the mature stage of its life.”
About a 90-minute drive southeast of that retirement mecca, the burgeoning Lake Nona area — with its Medical City cluster of research labs and hospitals — ranked 10th nationally for planned-community sales.
As The Villages winds down on its decades-long development of more than 100,000 mostly retirees, southeast Orlando is expected to be a primary driver of growth in the region for decades to come.
“And Lake Nona is the focal point for that,” Logan said.
The heady sales volume at both The Villages and Lake Nona underscores projections that greater Central Florida — from Lake and Osceola to Brevard and Volusia counties — is expected to attract Florida’s largest number of both millennials and Baby Boomers during the next quarter century, according to the Florida Bureau of Economic and Business Research.
Through 2040, the overall swath of Central Florida is expected to grow by 698,000 residents ages 50 and up; the population of twenty-somethings is expected to increase by 219,000 — a greater chunk of new boomers and young adults than projected for any region in the state, according to the research center.
“We are where Florida is growing,” Logan said. “We’re the spot.”
Despite the forecast growth for retirees and other residents who would be candidates for The Villages, that community’s longtime development engine is expected to stall out in coming years.
Last year, sales at The Villages dropped by 12 percent to 2,294; two years ago, they topped 3,400. Meanwhile in Lake Nona, sales volume isn’t as high but is rising: 500 sales last year reflected a 19 percent increase, Real Estate Advisors said.
While Lake Nona has room to grow for decades, The Villages is running low on lots, said Anthony Crocco, regional director for MetroStudy.
“They’re running out of lots and property,” the new-home-construction analyst said. He estimated they had about 6,000 to 8,000 lots, which would last about three years based on current demand.
Logan said prices at The Villages are about $100,000 higher than at their competitors and there is a reason.
“What they’re doing is smart,” Logan said. “They could keep prices more consistent with those kinds of communities across the state. But the pricing in the Villages is higher. They’re taking advantage of the fact that they’re at the last few years. And, as you raise prices, you’re going to lose sales.”
No one at The Villages would comment.
Land broker William Sullivan, of Potomac Land Co., said the end might be in sight for the existing lot inventory at The Villages, but developers there have some options if they want to purchase new tracts of property to continue growing in that area.
Meanwhile, the region’s strongest growth is expected to shift during the next quarter century to the burgeoning cluster of medical research, hospitals and fitness enterprises in southeast Orange, researchers say.
As construction crews in Lake Nona work on a national USTA tennis center with more than 100 courts, Crocco said Lake Nona developers are moving along from focusing primarily on residential and now gearing up to open shops, restaurants and other amenities.
Rob Adams, vice president for Tavistock’s Lake Nona development, said employees for the USTA center and the new VA medical center are helping drive sales and apartment rentals. Retirees and international buyers, particularly from Brazil, are also purchasing in Lake Nona’s Laureate Park community, he added.
A westward extension of Lake Nona Boulevard, to Boggy Creek Road, should be completed in the next few weeks and allow for continued growth. Also, the three-story GuideWell Innovation Center, with 92,000 square feet, is expected to open in the next eight weeks and lease to tenants including life-science, health-related and tech companies.
From his new offices at Lake Nona’s town center, Adams said: “You’re seeing big drivers happen.”